File-sharing Suits Go International

From the IFPI press release:

IFPI and the recording industry associations in Denmark, Germany, Italy and Canada today announced the first wave of international lawsuits charging individuals with illegally file-sharing copyrighted music.

A total of 247 alleged illegal file-sharers face legal action in a move that steps up the industry’s international campaign against online copyright theft. Further waves of lawsuits against major offenders will be launched in different countries in the coming months.

The legal actions, following similar successful actions in United States, charge the individuals with illegally making available hundreds of music tracks for copying, transmission and distribution via file-sharing services.

IFPI, representing the recording industry worldwide, made it clear that the legal actions come only after a sustained educational effort by the music industry and as record companies are making available the bulk of their music for downloading legally.

A recent independent five-country survey commissioned by IFPI shows more than 65% of people know that file-sharing copyrighted music is illegal.

More than 600,000 consumers in Europe alone are now accessing a large catalogue of 300,000 tracks that are available from 50 legal online sites.

Jay Berman, Chairman and CEO of IFPI. said: “Today’s announcement should come as no surprise. Over the past year the record industry has been extremely active internationally and locally, educating the public about the huge damage being done by illegal file-sharing, explaining the laws and promoting all the sites where large catalogues of copyrighted music are available for consumers to access legitimately. “

“We have made it clear that file-sharing without the permission of the copyright holder is illegal, that it amounts to “file-stealing”, and that it affect jobs and livelihoods across the whole industry. Ultimately, though, we have learned that education alone is not sufficient, and that some people persist because, like shop-lifters, they think they can ‘get away with it’. So we have decided that only the prospect of legal action is going to make those people rethink what they are doing.”

“Today we are making it clear that we are totally prepared to enforce the law, and we will start actions against those people who are breaking it by uploading hundreds of music files on to the internet. We will not stand by while thousands of people involved in the creation of music see their careers and livelihoods destroyed. The message is that people are at a real risk of being sued or prosecuted if they continue to rip off those who make music. “

Illegal file-sharing has been a major cause of the decline in global music sales in the last five years. This in turn has caused widespread cuts and job losses across the industry, affecting retailers, record companies and their artist rosters, recording studios, song writers, management companies, publishers and many others sectors, all of them economically dependent on copyrighted music.

Global sales of recorded music fell 7% in value in 2002. IFPI’s global figures for 2003 have not yet been released, but it estimated that sales for the year will have been down by over 7%. A number of third party surveys in major music markets have confirmed that illegal file-sharing directly depresses music purchases by consumers.

Other countries have stepped up their ‘warning’ campaigns to put illegal file-sharers of music on notice that if they continue with their activities they risk court action. Sweden is announcing today the launch of their instant messaging campaign to users of peer-to-peer networks, following a similar announcement by the UK on 25 March.

Statements by recording industry in the four countries

Peter Zombik, CEO of IFPI Germany:

“The unauthorised distribution of music on the web has increased to such an extent over the last few years that it is threatening the livelihood of the German music industry. Whilst we have so far concentrated our legal actions on illegal music offers on websites – in the last two years we were able to close down more than 2000 such websites in Germany – we also carried out an extensive public information campaign in the last year in order to increase the awareness for the legal and technical dangers involved in illegal file swapping. Excuses about being unaware of the legal position are no longer acceptable. “

“This information campaign, however, has not been enough to stem the unauthorised distribution of music on the web. That is why we have decided to go one step further and resort to legal means to put a stop to the unauthorised distribution of music on the web. Now no-one can claim that illegal music uploads are a peccadillo without any consequences.”

Johan Schluter, Secretary General, Danish Recording Industry Association:

“Illegal downloading, copying and ‘filesharing’ have seriously hurt the Danish music industry: CD-sales have gone down by 50% in just four years; people are losing their jobs; record stores are closing down; and artists find it increasingly difficult to get their music released.”

“While our efforts to warn and educate illegal file-sharers have been successful in terms of raising awareness of the issue, the illegalities have continued. Even if people now know it is illegal, they still upload and share illegal files. This situation is unacceptable to an industry that is working hard to launch legal alternatives where law-abiding citizens can enjoy and pay for their music.”

“The stealing has to stop. In a small market like Denmark the consequences of a dramatic drop in sales are strongly felt. And we are happy to have a united music scene supporting our activities.”

Brian Robertson, President of the Canadian Recording Industry Association:

“The Canadian litigation action was taken only after we had heavily invested in a year-long, nationwide education program and then a second communication program with Canadian users of KaZaA.”

“We have had four consecutive years of retail sales declines, staff layoffs and declining opportunities for artists and their music. If it takes litigation to restore the health of the Canadian music industry and drive home a message to hard-core exploiters of recorded music, then we view it as a regrettable but ultimately necessary action”.

Enzo Mazza, General Director of FIMI, the Italian Recording Industry Association:

“Music piracy is an enormous and ongoing problem in Italy, threatening the jobs and livelihoods of thousands of Italians in the music industry.”

“As Italians take up broadband, they also take up unauthorised P2P file sharing in increasing amounts – almost half of all regular internet users in the country already regularly download music although the activity is most popular with younger internet users.”

“3.3 million Italians use P2P services and most of them share illegal files over the net. We cannot allow this to continue at this pace. With this in mind the Italian industry has worked closely with the education authorities to get schools to adopt copyright protection measures.”

“And it is why the Italian music industry fully supports, and is co-operating as much as possible with, the public prosecutor. Illegal file-sharing is costing our industry jobs and stopping our talented young musicians from making music – it must stop.”

Legal action begins in four countries

The actions are being brought by the national IFPI-affiliated recording industry associations in the four countries on behalf of their member record companies. A summary of the legal actions is as follows:

  • Denmark: More than 120 people are being sent civil demand letters asking them either to stop illegal file sharing and pay compensation, or face legal action. These users were found allegedly to be offering between a few hundred and tens of thousands (54,000) of music files on file-sharing services.
  • Germany: 68 individuals have been reported to law enforcement authorities pursuant to criminal complaints for alleged peer-to-peer infringement. Evidence was submitted to the prosecutor that each individual was offering between 300 and several thousand music files on the internet.
  • Italy: 30 individuals have been charged with copyright infringement. The Public Prosecutor’s office in Milan ordered criminal raids that started in January. A special unit of the Fiscal Police has seized 25 computers, 30 hard discs and storage systems, and 50,000 files as evidence.
  • Canada: 29 individuals will face copyright infringement claims following court proceedings for disclosure by their internet service providers of their identification. Users in these cases allegedly were offering between 650 and 3,600 music files on file-sharing services.

These actions target people making available a large number of files on a range of file-sharing systems, including Kazaa, DirectConnect, WinMX, eMule and iMesh.

File-sharers found to be engaged in infringement could face criminal or civil penalties, depending on the law in each country. Damages payments or fines could amount to several thousands of euros for each individual.

Illegal file-sharing is bad for music, musicians and the music industry

Illegal file-sharing has severely affected music sales globally and significantly contributed to the loss of thousands of jobs and livelihoods in the music sector. This phenomenon has been occurring around the world, as global record sales slumped from US$38 billion in 1998 to just over US$30 billion in 2003.

The impact has been especially marked in the countries involved in the first wave of international lawsuits. In the past five years:

  • music retail sales in Canada fell by almost 30%
  • sales in Germany are down more than 30% in three years
  • album sales in Denmark slumped 50% over the same period
  • sales in Italy have fallen by 50 million euro between 2001 and 2003.

The number of copyrighted music tracks stored on internet file-sharing networks worldwide is now estimated at 800 million files – up from 500 million in 2002. Encouragingly, this figure is down from the 1 billion files estimated in April 2003, a fall partly attributed to lawsuits filed in the US in the last year.

Global and local education efforts continue

Record companies’ moves to get music legitimately to consumers online, and to raise public awareness around online copyright, will continue. Recent figures released by IFPI show that the general public has a very high level of awareness that unauthorised file-swapping is illegal, indicating that the industry’s public education activities have had an effect. An average of two in three people in four European countries surveyed know that sharing copyrighted music on peer-to-peer networks is illegal. Another 54% support the industry’s legal actions against major internet infringers.

High-profile awareness campaigns in the last twelve months include:

  • Brochures sent to thousands of colleges, government departments and companies in over 20 countries highlighting the legal and security threats of hosting unauthorized file-sharing services.
  • The launch of the pro-music website, an international educational campaign supported from across the music sector aimed at tackling the myths around online music piracy and promoting legal sites. National versions have since also launched.
  • Over 21 million instant messages have already been sent to users of peer-to-peer services warning of the legal risks of unauthorized file-swapping (sent in Austria, Australia, Canada, Denmark, Germany, Sweden, UK, and the US in 2003-04).
  • The IFPI Online Music Report showing the music industry’s internet strategy “turning the corner” with a substantial migration of consumers from unauthorized services to the legitimate alternatives.

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